By: The BitMar Team.
Image Source: Gemini.
A video codec (an abbreviation for coder-decoder) is a fundamental technology responsible for making modern video streaming possible. Its primary function is to compress, or shrink, large raw video files into manageable sizes for transmission over the internet. The corresponding decoder, on a viewer's device, then decompresses the file for playback. Without this compression, video files would be too massive for most internet connections to handle, resulting in constant buffering and an impractical viewing experience.
The efficiency of a video codec directly impacts the operational costs for streaming services. A significant portion of a streaming provider's budget is allocated to bandwidth and data storage. More advanced codecs achieve higher compression ratios, meaning they create smaller video files while maintaining the same level of visual quality. When files are smaller, less data transfers over the network, which directly reduces a provider's bandwidth expenses and content delivery network (CDN) costs.
Newer codec standards, such as AV1 (AOMedia Video 1), represent a significant leap in this efficiency. Reports indicate that AV1 can be 30 to 50 percent more efficient than older, common codecs like H.264. For the viewer, this technology allows for higher-quality video with less buffering. For the provider, it means a substantial reduction in the data required for every stream, making high-resolution content delivery more economical.
Video streaming is the largest contributor to all internet data traffic. This volume places an immense strain on the global network infrastructure. Studies from technology companies highlight that adopting efficient codecs is essential for managing this traffic growth. By reducing the bitrate (the amount of data transferred per second) for a video, advanced codecs can lower delivery costs significantly, allowing services to scale and serve many viewers simultaneously without system overload.
Beyond compression efficiency, the licensing model of a codec is a major financial consideration. Some codecs, such as H.265 (HEVC), require providers to pay royalties for their use. In contrast, the AV1 codec is an open-source, royalty-free project supported by many large technology firms. By adopting royalty-free codecs, streaming companies can eliminate substantial licensing fees, which further reduces the total cost of delivering content to consumers.
While viewers may never interact with codecs directly, this underlying technology is a critical component of the streaming industry's business model. The continuous development of more efficient codecs is essential for managing delivery costs, improving visual quality, and making higher-resolution formats, such as 4K and 8K, a viable reality for a mainstream audience.
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